UK VAT Calculator — Add or Remove VAT
Add VAT to a net price or take VAT out of a gross price, at the UK rates of 20%, 5% or 0%. The calculator shows the net amount, the VAT and the gross total — and does the removal the right way, by dividing, not by knocking 20% off.
Gross Price (including VAT)
How It Works
Value Added Tax (VAT) is a tax added to most products and services sold by VAT-registered businesses in the UK. The UK has three VAT rates. The standard rate is 20% and covers most goods and services. The reduced rate is 5% and applies to a short list of items — GOV.UK gives children's car seats and home energy as examples. The zero rate is 0% and applies to zero-rated goods and services, such as most food and children's clothes. Some things are exempt from VAT altogether, such as postage stamps and most financial and property transactions; exempt supplies are different from zero-rated ones, because zero-rated sales still count as taxable supplies while exempt sales do not.
Adding VAT is straightforward multiplication: gross = net × (1 + rate). A net price of £100 at 20% becomes £100 × 1.20 = £120, of which £20 is VAT. Removing VAT is where most people go wrong. The wrong way is to knock 20% off the gross price: £120 minus 20% is £96, which is not the net price. The right way is to divide by 1 + rate: £120 ÷ 1.20 = £100, so the VAT inside that £120 is £20. The reason is simple — the 20% was charged on the net £100, not on the gross £120, so reversing it means dividing, not subtracting a percentage. The same logic applies at 5%: a gross price of £210 has a net price of £210 ÷ 1.05 = £200 and VAT of £10.
| VAT rate | What it applies to | Examples (GOV.UK) |
|---|---|---|
| 20% — standard | Most goods and services | Most things you buy day to day |
| 5% — reduced | A short list of goods and services | Children's car seats, home energy |
| 0% — zero-rated | Zero-rated goods and services | Most food, children's clothes and shoes, books and newspapers, motorcycle helmets |
| Exempt | No VAT charged at all | Postage stamps, financial and property transactions |
Worked Example
A freelancer quotes a client £100 net for a piece of work. At the standard 20% rate, the VAT is £100 × 20% = £20 and the gross invoice total is £120. If the client later asks what the VAT was on a £120 invoice, the answer is not £24 (20% of £120) — it is £20, found by dividing: £120 ÷ 1.20 = £100 net, and £120 − £100 = £20 VAT. The two directions reverse each other exactly, which is the test of a correct VAT calculation.
At the 5% reduced rate, a net price of £200 becomes £200 × 1.05 = £210 gross, with £10 of VAT. Removing VAT from £210 gives £210 ÷ 1.05 = £200 net and £10 VAT. At the 0% zero rate, the net and gross prices are the same and no VAT is charged — but the sale is still recorded as a taxable supply on a VAT return, unlike an exempt sale.
The table below shows the VAT and gross totals for common net prices at 20% and 5%:
| Net price | VAT at 20% | Gross at 20% | VAT at 5% | Gross at 5% |
|---|---|---|---|---|
| £50 | £10.00 | £60.00 | £2.50 | £52.50 |
| £100 | £20.00 | £120.00 | £5.00 | £105.00 |
| £250 | £50.00 | £300.00 | £12.50 | £262.50 |
| £500 | £100.00 | £600.00 | £25.00 | £525.00 |
| £1,000 | £200.00 | £1,200.00 | £50.00 | £1,050.00 |
Assumptions — and What This Calculator Leaves Out
- UK VAT rates as published on GOV.UK — 20% standard, 5% reduced, 0% zero-rated — checked on 13 November 2026. The standard rate has been 20% since 4 January 2011.
- One rate per calculation. The calculator applies a single rate to a single price. If an invoice mixes rates (for example standard-rated goods and zero-rated food), work out each line separately.
- It does not choose the rate for you. Which rate applies depends on the goods or services and how they are used. If you are unsure, check HMRC's rates list or ask your accountant.
- Businesses must register for VAT once their taxable turnover is more than £90,000. Only VAT-registered businesses charge VAT; if you are not registered, you do not add VAT to your prices.
- Not covered: VAT accounting schemes (such as the Flat Rate Scheme), margin schemes for second-hand goods, VAT on imports and exports, partial exemption, and the VAT you can reclaim on business purchases. This calculator works out the VAT on a price — it is not a VAT return.
Sources: GOV.UK — VAT rates (20% standard, 5% reduced, 0% zero-rated, exempt categories) and GOV.UK — How VAT works (£90,000 registration threshold, zero-rated examples). Last reviewed: 13 November 2026.
Built and tested by SumKitTool — see how we check our numbers.
How to Use This Calculator
Choose the calculation first. Add VAT is for when you have a price excluding VAT — a supplier's net quote, or the amount you want to charge before tax — and need the gross total. Remove VAT is for when you have a price that already includes VAT — a shop receipt or an invoice total — and need to find the net amount and the VAT inside it. Then enter the amount and pick the rate: 20% for most goods and services, 5% for the reduced list, or 0% for zero-rated items. Results update as you type: the headline figure is the gross price in add mode and the net price in remove mode, and the table shows all three figures — net, VAT and gross — so you can check them against each other.
Use the two modes to check each other's work. Add VAT to a net price, note the gross total, then switch to remove mode, enter that gross total at the same rate, and you should land back on the original net price to the penny. If a supplier's invoice does not reconcile that way, one of the figures on it is wrong — usually the VAT line, where someone has taken 20% of the gross total instead of dividing by 1.20.
Tips and Practical Advice
Never remove VAT by subtracting 20%. It is the single most common VAT mistake, and it always understates the net price: £120 minus 20% is £96, not £100. The correct method is to divide by 1.20 (or 1.05 at the reduced rate). If you remember only one thing from this page, remember the division.
Keep zero-rated and exempt separate. Both mean no VAT is charged, but zero-rated sales are still taxable supplies and count towards your VAT registration threshold, while exempt sales do not. If you sell a mix of both, the distinction affects whether you must register for VAT and how much input VAT you can reclaim.
Quote net or gross, but say which. A quote of “£100” means £100 to one customer and £120 to another, depending on whether they expect VAT on top. State “£100 + VAT” or “£120 including VAT” on every quote and invoice so there is no argument later — and check that the VAT line on invoices you receive divides back correctly before you pay them.
Finally, watch the registration threshold. Once your taxable turnover passes £90,000 in a rolling 12-month period you must register for VAT, and from then on you charge VAT on your sales and reclaim VAT on your business purchases.
Frequently Asked Questions
How do I add 20% VAT to a price?
Multiply the net price by 1.20. A net price of £100 becomes £100 × 1.20 = £120 gross, of which £20 is VAT. At the 5% reduced rate, multiply by 1.05: £200 net becomes £210 gross, with £10 of VAT.
How do I remove VAT from a gross price?
Divide by 1 + the rate — 1.20 at the standard rate, 1.05 at the reduced rate. A gross price of £120 at 20% VAT gives £120 ÷ 1.20 = £100 net, so the VAT inside it is £20. Do not subtract 20% from the gross price: £120 minus 20% is £96, which is wrong.
What is the difference between zero-rated and exempt?
Both mean no VAT is charged, but zero-rated sales are still taxable supplies — they count towards the £90,000 VAT registration threshold and the business can reclaim input VAT. Exempt sales, such as most financial and property transactions, sit outside the VAT system entirely and do not count towards the threshold.
Which goods are charged at 5% VAT?
The reduced rate of 5% applies to a short list set by law. GOV.UK's examples are children's car seats and home energy (domestic gas and electricity). Other items on the list include mobility aids and certain residential renovation work. Check HMRC's rates list for the full picture before applying 5% to an item.
When must a business register for VAT?
A business must register for VAT once its taxable turnover is more than £90,000 — the total value of everything it sells that is not exempt. Businesses can also choose to register voluntarily below that threshold. Only VAT-registered businesses charge VAT on their sales.
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